AbstractPower‐to‐methane (PtM) offers an efficient opportunity for surplus renewable energy storage, but heat management is a major challenge for conducting the highly exothermic methanation reaction. To address this challenge, this study presents the first successful demonstration of core‐shell catalyst pellets in a pilot‐scale reactor for CO2 methanation. Experiments in a wall‐cooled fixed‐bed reactor are conducted with diluted and undiluted reactant feed under systematic variation of cooling temperature and inlet gas flow rate. The results show that core‐shell catalyst pellets significantly reduce the hot‐spot temperature while maintaining comparable reactant conversions to uncoated catalyst pellets at the same conditions. Additionally, core‐shell catalyst pellets allow for undiluted reactant feed at comparably low hot‐spot temperatures (approx. 600 °C).